“student Loan Lobbying And Policy Influence: Unraveling The Politics”

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Biden said on the campaign trail that if elected, he would “immediately” seek to eliminate $10,000 in student loans for every federal borrower, a measure he would have at his disposal. Is. But a year into his presidency, Biden has failed to deliver on that pledge, much to the dismay of borrowers like Robb.

“student Loan Lobbying And Policy Influence: Unraveling The Politics”

“I know I have to start making payments,” Rob, who is studying to be a teacher and didn’t want to give his full name for privacy reasons, told Insider. “Teachers don’t do much, and it’s going to have a huge impact on me, already on my quality of life.”

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In fact, the 34-year-old, along with about 45 million other Americans who took out federal loans for their higher education, will have to resume loan repayments on May 1 when the Biden administration’s pandemic break ends.

“It’s annoying because you vote for Democrats, and they honestly never follow through on their promises,” Robb said. He owes about $60,000 in student loans and said he won’t vote in this year’s midterm elections unless the president follows through with the $10,000 cancellation.

“I would be surprised, and if they do I would be very happy to go to the voting booth,” he added. “But right now they need to get my vote, and right now they’re not doing that.”

The White House has been slow to take sweeping steps on student loan cancellation as Biden has questioned his legal ability to do so and has shifted the onus to Congress. Meanwhile, student loan companies that process a record-breaking $1.7 trillion in debt have poured money into lobbying and politicians’ war chests to oppose a broad repeal — spending that Biden would not approve. Can provide some clarification on functionality.

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Efforts by recent Democratic leadership to stem the flow of money into politics have failed. Yet despite the costs and lobbying, experts say there is a glimmer of hope for advocates fighting for student loan cancellation.

“It’s an interesting kind of David and Goliath fight,” said James Thurber, a political scientist at American University who teaches ethics and lobbying seminars, “where David is winning on a few things but the whole policy shift. But no.”

Why Biden hasn’t pursued broader student loan forgiveness is unclear, but the student loan industry’s widespread influence on politics may shed some light on the administration’s position.

Student loan companies spent about $4.5 million on lobbying efforts last year, according to OpenSecrets, a nonprofit that tracks campaign finance and lobbying data. Along with student loan issues in Biden’s COVID-19 stimulus package last year, the industry lobbied against a break in student loan repayments during the pandemic. In 2020, the industry spent nearly $4 million on lobbying.

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The federal government contracts these companies to service student loans to borrowers. In return, companies earn a fee for each loan they make.

Navient, formerly one of the largest federal student loan servicers, spent about $1.7 million on lobbying last year and made $717 million in profits. (Beset by decades of controversy and accusations of misleading lenders, Navient won approval from the Education Department in October to close its federal loan servicer late last year. The company has consistently denied wrongdoing but recently reached a settlement with 39 attorneys. generally over allegations of misconduct.).

Another major student loan company, Nelnet, spent $230,000 on lobbying in 2020. That same year, Nelnet made over $352 million in profits.

“They’re lobbying to make sure they have a profit. They’re not lobbying for the public interest of students, in my opinion,” Thurber told Insider. “They’re interested in the bottom line.”

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Navient said in its 2021 mid-year lobbying report that the company has rallied behind a number of student loan issues, including improving loan repayment programs, helping borrowers default on their loans Doing so, and simplifying the bankruptcy relief process. The company had no comment for this story.

A Nelnet spokesperson told Insider that it is a “diversified company with many businesses affected by federal policy including banking, loan servicing, payments, renewable energy, and telecommunications.”

“As such, Nelnet is interested in and engaged in policy discussions on a wide range of federal topics,” the spokesperson added.

Student loan companies through political action committees are also major donors to political campaigns. According to OpenSecrets, in 2020, the industry donated about $715,000 to candidates, with the money split evenly between the two parties.

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Biden was the top recipient in 2020 with $38,535 from student loan companies, followed by his opponent, former President Donald Trump, who received $25,716.

“Our concern has always been that capitalist interests have too much presence and influence over policy,” Dan Obel, a senior researcher at OpenSecrets, told Insider.

This expense is not new. According to OpenSecrets, student loan companies have spent more than $47 million on lobbying the federal government and nearly $5.5 million on campaign contributions over the past decade, trying to curb student loan policies. Efforts have been made which are against their interests.

“There are other forces at work that are influencing what’s going on as well. So it’s certainly not the only factor, but you can pretty much be sure that businesses involved in student debt are Interests are making their voices heard,” Obel said.

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Representative Virginia Foxx of North Carolina, the top Republican on the House Education and Labor Committee, has received nearly $30,000 from student loan companies over the past two election cycles. He recently rejected Biden’s extension of a moratorium on monthly loan payments and has opposed student loan cancellation.

The power of lobbying does not appear to be weakening anytime soon. Since Biden took office, Democrats have tried unsuccessfully to curb the influence of money in politics. The People Act, an election and campaign finance review that passed the House last year but was blocked by the Senate, would have tightened ethics rules for federal officials and lobbyists.

In particular, the legislation would have slowed the so-called revolving door of government officials who become lobbyists for the industries they once oversaw, using their insider knowledge and expertise to advance their clients’ interests. Depend on connections. OpenSecrets has found that more than half of lobbyists in the education industry have gone through the revolving door.

“Lobbyists are actually writing legislation and pieces of legislation. They have relationships on Capitol Hill and with people in the White House and the executive branch. They’ve often gone through the revolving door,” Obel said. “They have a good idea of ​​how to put pressure on different sectors of government. So it’s clear that the roughly $4 billion that’s spent on lobbying each year has some impact on policy.”

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Current law maintains that former senior-level government officials must be barred for one year unless they engage in lobbying. The For People Act would have doubled that waiting period to two years, as many officials often flout existing laws.

The bill would also have increased transparency by closing the loophole of “shadow lobbying,” which refers to individuals who try to influence policy, for example, by meeting with lawmakers or hiring lobbying firms. giving advice, but who are not actively registered as lobbyists;

“There are a lot of people on the Hill who lobby and meet the definition of lobbying,” Thurber said, “but they’re not registered, and that’s wrong. It needs to be enforced more.”

Yet the 800-page legislation failed in the Senate because Republicans largely opposed the bill, and Democrats could not overcome the 60-vote filibuster requirement.

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“Mitch McConnell said he wouldn’t take anything” into the bill, Thurber, who personally favors increased transparency around lobbying and worked on reforms during the Obama administration, told Insider. “There were things in the lobby that a lot of Republicans in the Senate wanted as well, but nobody is touching it because that’s his position as the minority leader.”

“I don’t think the minority party in the Senate has a strategy — not on everything,” he continued.

Many Americans have long held the perception that corporate, wealthy interests and lobbies wield too much power over policymaking, leading to distrust in the federal government. Democratic, Republican and independent voters have expressed support for cleaning up political corruption.

Thurber said transparency around lobbying is important “because in a democracy, you have to trust the institutions that are making your laws.” “If you have all kinds of personal, narrow interests, you have influence and you don’t know about it, that really undermines democracy fundamentally.”

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Student loan borrowers and the Too Much Talent band thanked President Joe Biden and Vice President Kamala Harris for extending their call to end student debt at a rally outside the White House in January. Paul Morighi/Getty Images for We, The 45 Million

Republicans held off on massive student loan forgiveness.

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